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How to Avoid Crooks When You Buy a Car Online

Written by: Jeff Brown11/14/13 - 10:00 AM EST

NEW YORK ( TheStreet) -- Go back a decade or so and many people were so leery of the Internet they wouldn't order so much as a book. Though confidence has grown, some of that old caution is worth preserving, with online shoppers increasingly becoming victims of fraud for big-ticket items such as cars and trucks.

Shopping for a home online is pretty safe, because few people buy a home they haven't checked out in person and because the title company makes sure the seller really owns the property. Small items are sometimes offered by online crooks, but reputable sites such as eBay have safeguards, and there's not much money at risk when you order a sweater.

But cars and trucks present a special problem because real money is at stake, and because buyers of used vehicles often have a hard time finding what they want nearby. Rather than travel hundreds of miles just to inspect a vehicle for sale, some buyers pay up front only to find later that the vehicle doesn't exist.

Find that hard to believe? Actually, online vehicle fraud is surprisingly common. A Romanian fugitive and six accomplices in an international auto-sale scam were promoted recently to the FBI's most-wanted list. The FBI says the group targeted Americans through legitimate websites such as eBay, Cars.com and AutoTrader.com, typically offering vehicles priced from $10,000 to $45,000.

"The defendants employed co-conspirators who corresponded with the victim buyers by email, sending fraudulent certificates of title and other information designed to lure the victims into parting with their money," the FBI said. The scammers used phony passports so accomplices could open U.S. bank accounts to receive buyer's wire transfers, the FBI alleges.

Last year there were more than 17,000 consumer complaints about online auto fraud, with alleged scams costing more than $64 million, according to The Internet Crime Complaint Center. The most common victims are men aged 30 to 60.

In the typical case, the fraud involves a non-existent vehicle offered at a below-market price. Often, the ad states that the sale must be quick because the seller is moving or needs cash for a tragic family situation. The crook cites the short timeframe in refusing to allow a vehicle inspection. The buyer is instructed to send money to a third party that sounds like a legitimate agent, then to send the receipt to the seller as proof of payment. Once payment is made, the seller vanishes.

"In a new twist, the criminals have attempted to pose as dealers instead of individuals selling a single car," IC3 says. "This allows them to advertise multiple vehicles for sale at one time on certain platforms, potentially exposing more victims to the scam."